Mercedes Benz and US Tsubaki Automotive expanding in Chicopee - city council approves a tax incentive

Chicopee, MA According to mayor Richard Kos, the city council has approved a tax incentive for the announced Mercedes Benz dealership to be located in Chicopee.

The Mercedes Benz dealership will be located at the site of the former Plantation Inn at 295 Burnett Rd. The dealership will be 35,000 s/f in size and is expected to employ a minimum of 35 permanent, full-time jobs.

Springfield Automotive Partners, LLC will be investing $9.6 million in property acquisition, demolition, and construction. They will also be investing $1.5 million on machinery and equipment, and $700,000 in other costs for a total investment of $11.8 million.

The city council approved the certified project application at their March 3 meeting. The application now will be sent to the Massachusetts Economic Assistance Coordinating Council (EACC) for final approval.

“This will be a significant project to the region and to the city of Chicopee,” said Michael Vedovelli, director of community and economic development for the city. “Having an out of state business expand and invest in our community points to the fact that Chicopee has a geographic advantage as the Crossroads of New England as well as a friendly business climate.”

Rending of the Mercedes Benz dealership - Chicopee, MA

The approved tax incentive plan calls for Springfield Automotive Partners to receive a tax break of 50% on the increased value for fiscal years 2018, 2019, and 2020. They will receive a break on 25% of the increased value in fiscal years 2021 and 2022.

During the period of demolition and construction on the property, Springfield Automotive Partners has agreed to continue payment of taxes on the property at the current assessed value.

The tax incentive agreement was unanimously approved by the economic development incentive program project review committee. The approval of the city council completes the deal.

“This is a substantial commitment by Peter and his group that will have the potential to transform this site and have a prestigious presence for years to come,” said mayor Kos. “Through this agreement we are able to maintain the current level of tax revenue being generated, in addition to improving a major gateway to our city.”

“This is an exciting project,” said city council president John Vieau. “We replace an abandoned motel with an upscale car dealership while improving the area surrounding exit 6, it’s a home-run.”

The project is expected to be completed by December 31, 2016 with an anticipated opening of April 2017.

In addition, US Tsubaki Automotive, LLC is expanding their Chicopee facility. The parent company, Tsubakimoto Chain of Osaka, Japan recently approved this project to expand the manufacturing facility. US Tsubaki Automotive currently produces high quality timing drive systems for the top 6 North American auto manufacturers. Globally Tsubakimoto Chain has over a 30% market share in the automotive timing chain business.

The expansion will include a new research and development lab, offices and additional factory floor space. Expanding Chicopee will allow US Tsubaki to grow market share in North America and provide engineering support and components to other Tsubakimoto Chain subsidiaries around the world. Related investment is expected to be over $12 million in addition to creating at least 35 new jobse.

Strong support from mayor Kos, the city council and the Commonwealth of Massachusetts was vital to US Tsubaki selecting Chicopee as the location for this expansion.

“This is very exciting news for the City of Chicopee. My administration worked very closely with the City Council and the Commonwealth of Massachusetts to make Chicopee the preferred location for this expansion. US Tsubaki is a leading employer in our community, and the company’s willingness to expand and hire here continues to demonstrate that Chicopee really is a great place to grow and invest,” said mayor Kos.